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Botched Centrelink debt collection leaves couple $37,000 out of pocket

25 January 2017
Kara Sonter
Northside Chronicle

Centrelink wrongly billed an elderly Brisbane couple $45,000 who scrambled to repay the debt or risk losing their pension, only to find out they owed much less.

Sam Scherhag, 90, and his wife Joyce, 88, were given a month to repay Centrelink $22,239.82 each in overpayments from the past three years.

Mr Scherhag said he was told if the bills were not paid by August 23, 2016, he and his wife would lose their pensions.

He said Centrelink refused his request to pay the bill in instalments and would not grant a seven-week extension when they asked last year.

Department of Human Services general manager Hank Jongen said partial lump sums and other payment arrangements were possible for those in debt, depending on one’s financial situation, but other actions were taken if no arrangement had been made.

[...]

Mr Scherhag said without his pension, he would not be entitled to a concession that covered $2000-worth of monthly cancer medication, so he and his wife scrambled to pay the nearly $45,000 combined debt with the help of their son Stuart.

On November 25 — more than three months later — Mr and Mrs Scherhag were told Centrelink got it wrong.